Please answer both of the questions in one sitting ........... Please it should
ID: 431235 • Letter: P
Question
Please answer both of the questions in one sitting ........... Please it should be short and correct
1) Is the mechanism of management being assigned the authority to resolve conflicts among stakeholder giving management even more discretion than allowed under the shareholder theory to make self-interested decision, which confirms that they cannot be trusted? if yes- why? if no-why ?
2) shareholders are now just passive impotent beneficiaries valid as to tangible property? Why? or why not? . Valid as to intangible property why or why not?
Explanation / Answer
1. In my views, stakeholder theory had been formulated with the objective to make the business accountable to its key stakeholders. Hence, instrumental power and normative validity comes under the purview of this theory. Often the self-interested decisions are overpowered by the common objective of maximizing business profits. Hence, under the theory of stakeholder management, the management has been given adequate powers to resolve conflicts among stakeholders because as per this theory, stakeholder is the most critical entity and must be sustained.
2. Intangible properties of a business are the goodwill, IP rights, licenses as well as the dedicated customer lists. The tangible properties of business are the products, its resources and the infrastructure. A shareholder cannot be considered as a passive beneficiary of such property. This is because al activities that a business undertakes, prioritizes the shareholders needs and views. The receptiveness and acceptability of the shareholders is one which can make or mar business of an individual or organization, as a whole. Hence shareholders occupy the central stage in any business model, and must be given due credits for the same.